On Wednesday, T-Mobile announced a new $40 "Simple Starter" plan which includes unlimited talk, text and 500MB of 4G LTE data. Those going over the data cap will find their data speed reduced to 2G speeds. Any equipment installment plan balance will be added to the price.
T-Mobile CMO Mike Sievert says that while Verizon and AT&T have similar plans, their data caps are so low that customers face large overage amount on their bill. "It’s a bait and switch. Typical customers will easily pay double that. People need to call them out for this," said the T-Mobile executive. The carrier's CEO, John Legere, went after his favorite target. He noted that AT&T's low-end plan can end up costing 44% more than advertised because of overage fees, which he says hurts those people who can afford it the least. The new T-Mobile plan throttles data speed instead of charging for overages.
More industry shattering news is expected to be announced soon by T-Mobile. Legere said in a company blog post that T-Mobile has just started shaking up wireless. Marketing chief Sievert said that over the next three days, the company will announce big news affecting three separate segments of the industry. "Our work of transforming wireless on behalf of American consumers is far from done," said CEO Legere. "Stay tuned in the days ahead."